BREWER, Maine — Changes in 2008 to the Ellen M. Leach Memorial Home’s management partnership — which consists of the Brewer Housing Authority and the Leach Home’s board and executive director — have raised concerns recently with state and local officials.
The basic problem is that those changes have not been approved by the Maine State Housing Authority, Julie Hashem, MSHA manager of communications and planning, said Friday.
“The Ellen Leach Home had effected operational changes that were not consistent with the approved management agreement,” she said.
That management agreement lists the BHA as the managing agent.
The changes made give management duties to Dorothy “Betty” Igoe, who is the Leach Home executive director. Igoe, who also lives at the Leach Home, gets a reduced rent for her services.
“In the eyes of Maine [State] Housing Authority, we are the management agent because they never signed off on that agreement” to use Igoe, said Gordan Stitham, BHA executive director. “Maine State Housing Authority does not consider her as a part of that management agreement.”
Every multifamily property that MSHA provides financing for must have an approved management agreement in place, Hashem said.
The problem was put in a spotlight when U.S. Department of Housing and Urban Development officials in November listed the housing authority’s management of the Leach Home, along with a $23,000 decrease in management fees for those services, as a concern during its review of BHA’s books.
“The BHA should seek legal counsel and pursue adherence to the current signed management agreement,” the HUD report suggests.
The housing authority board hired Bangor attorney Edward Gould to review the Leach Home situation. The situation is further complicated by the fact Igoe served as executive director of the housing authority until January 2008, when she retired and took the Leach Home position, and that Frank McGuire, who sat on both the BHA and Leach Home boards, just resigned from the BHA board in mid-December. His resignation is on the Jan. 12 City Council agenda.
The $23,000 decrease in management fees “it was explained … was due to the former executive director [Igoe] taking over some of the management duties and being compensated from Leach Homes,” HUD’s report states.
Gould, in a Dec. 16 letter sent to McGuire, states that “MSHA never approved the proposed amendment to the Management Agreement. Further, even if it had been approved, the term of that agreement was limited to one year.”
The letter also states the housing authority plans to reassert its management rights and responsibilities.
“BHA intends to exercise all of the functions set forth [in the management agreement on file with the state] and to insist upon full compensation pursuant” to that agreement, the letter states.
The issue, especially Gould’s letter, was the hot topic during the Dec. 29 BHA board meeting, Stitham said. In an attempt to resolve the issue, the leaders of the two local boards are planning a meeting in the near future, McGuire said.
“We’re working out a date for a meeting and expect to work things out in an amicable way,” McGuire said.
“We’ve agreed to meet to see if anything can be done,” Gould said. “What we’re trying to do is get that issue resolved.”
Whatever is done will need Maine State Housing Authority approval.